Nissan's luxury brand Infiniti is setting up a production base in China through its joint-venture partner Dongfeng.
The long-awaited indigenisation of Infiniti will help raise sales significantly. Nissan did not unveil the details of the arrangement, however. In a statement yesterday, the Japanese carmaker only said the two Infiniti models would be produced on the mainland by 2014.
The announcement came after Dongfeng admitted last month it was in talks with Volvo for a new partnership on trucks and vans, while Nissan would give up its current partnership with Dongfeng on commercial vehicles for a tie-up on passenger cars.
Dongfeng would also help Infiniti and Renault, which has a long-term partnership with Nissan, to manufacture in China.
Infiniti, which exported only 1,000 vehicles to China when it entered the market in 2007, saw sales reach 19,075 last year. Making the car in China is expected to boost sales to 100,000 in four years, a fifth of the sales target worldwide by 2016.
The location of the production facility has yet to be revealed but it is widely expected to be at Dongfeng's plant in Xiangyang, Hubei.
According to an environmental assessment by the Dalian Environmental Protection Bureau, however, Dongfeng has already submitted an application to build a 5.04 billion yuan (HK$6.18 billion) factory in Dalian, with an annual capacity of 240,000 passenger cars.
Nissan will launch a new version of its mid-size Infiniti M35 hybrid sedan at the Beijing Auto Show on Monday while Renault is expected to announce details of its plans.
For years, foreign luxury automakers have set up production lines on the mainland to avoid the high import tax and cut costs.
Jaguar Land Rover and Chery recently set up a joint venture. Land Rover chief executive Ralf Speth said the company will invest up to ?100 million in a new factory that could produce up to 150,000 vehicles in the first three years.